Found on Soggy Island, to the right of getting off the boat
Do a quick minigame involving clearing rats from the old mine under a minute (isnt too hard, the run away from you so you have to keep them grouped together and spill into the drain.)
The diamond mine then opens.
You most likely don't need to get all the diamonds (but you are pretty much set for the rest of the game on coins if you get them and sell them to the diamond2cash shop). There are 9 levels, each progressively getting longer and slightly more difficult. The game gives you a rope and headlight to help navigate. However, I also had double jump and sprint, which helps A LOT, especially double jump. You can skip parts by using your double jump late and being right about the platform you need to land on. I usually use the rope to make sure where the platforms were then if I fell, I used the double jump strat to go quicker.
This is probably the longest section of the game for one achievement (about 30-45 minutes). If you need any more tips, please let me know in the comments